THE economic impact of the global spread of COVID - 19 has heightened market risk aversion in ways not seen since the global financial crisis. Stock markets have declined over 30%; implied volatilities of equities and oil have spiked to crisis levels; and credit spreads on non-investment grade debt have widened sharply as investors reduce risks. This heightened turmoil in global financial markets is occurring despite the substantial and comprehensive financial reforms agreed by G20 financial authorities in the post- crisis era.

These challenges are also very different to the previous financial crisis. Understanding current market fragilities, paths of market contagion, and policy implications calls for a sober assessment of the changing structure of global markets and financial intermediation in the post-crisis era.